Be a Confident Shopper by Understanding Coupons…
Have you ever really took the time to look at your coupons and wondered what the heck all those different codes and numbers mean?! Well, my goal today is to break down the “secret” coupon codes, so that you are more confident and educated when using your coupons! Please note that I am in no way trying to provide information that allows you to use coupons inappropriately or for an unintended use!
A typical coupon barcode looks like the image below on the left that says “UCC Coupon Code”:
(Thanks to AccuGraphiX for this image)
UCC Prefix – This portion of the code will be either a 5 or a 9. It deals with doubling. If your store doesn’t double coupons, then this number has no purpose. If your store DOES double coupons, then any coupon coded with a 5 will double (up to your store’s doubling limit) and any coupon coded with a 9 will not double.
UCC Company Prefix – These numbers identify the manufacturer of the couponed item and MUST match positions two through six of the UCC Company Prefix on the product that is being purchased (this is the way that the register can validate you are purchasing the right product(s) for the coupon being used).
Family Code– Most manufacturers break their products into families and the family code allows the coupon to be coded for a specific product that the manufacturer sells (i.e. Crest may have a coupon that is only good for Crest Pro-Health Toothpaste so the family code on the coupon would validate this at checkout and would beep if you purchased a different variety of Crest toothpaste).
Value Code-This code tells the register what you need to purchase and how much to take off at checkout. The are over 100 value codes, so I will not be listing them all. Here are some examples:
00: Free product Coupon– will beep and require the cashier to manually input the amount to take off.
14: B1G1
50: $0.50 off
99: $0.99 off
*Keep in mind that coupons will occasionally scan successfully for items not listed on the coupon or even excluded by the terms written on the coupon. Just because the coupon scans does NOT mean that it is okay to use coupons for unintended items…this is actually coupon fraud and is illegal!
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OK, so now that you understand coupon coding, do you really know how the process of coupon redemption works for stores?! What do stores do with those stacks of coupons that they collect from all of us savvy shoppers?
Coupon Redemption Process:
-Manufacturers design coupon promotions with their sales/marketing teams
-Coupons are distributed via newspaper inserts, direct mail campaigns, via the internet etc.
-A very “hip” shopper excitedly enters the store and proudly uses all of his/her coupons at checkout 😉
-The cashier scans the coupons and puts them into the cash drawer. Typically, at the end of the day the coupons in each cash drawer are added up as if they were cash, and that amount is added to the cash sum to be sure the overall total for the drawer is accurate.
-Once per week, all of the manufacturers’ coupons (and any coupons issued by the grocer) are sent in plastic bags or pouches to the store’s corporate headquarters.
-There is a very lucky person at headquarters in charge of processing the coupons. That person boxes all of the bags of coupons and ships them to a third-party clearinghouse.
-The clearinghouse is then responsible for doing the most important part of the coupon redemption process– separating the coupons by manufacturer or by scannable coupons versus damaged/torn coupons. Most of this process is done by hand. Sometimes coupons are put face up on a conveyor belt and move under a scanner that reads the UPC codes and tallies the amounts. However, damaged and torn coupons have to be tallied by hand. The clearinghouse then sends all the sorted coupons with an invoice to the manufacturer.
-The manufacturer will reimburse stores the face value of coupons or if the coupon calls for free merchandise, for the retail-selling price up to the stated maximum value printed on the coupon PLUS 8¢ for handling each coupon properly redeemed (this 8¢ value may vary slightly). Many times manufacturers, such as ConAgra Foods, will also reimburse retailers that are using a clearinghouse or billing agent at a rate equal to $5.50 per thousand of coupons redeemed.
-The manufacturer either reimburses the clearinghouse for the amount of the invoice, and the clearinghouse mails a check to the store for the amount of the coupons OR the manufacturer sends a check directly to the store and the store then pays the clearinghouse. (The clearinghouse is paid a certain amount per coupon by the store, plus shipping and handling).
(Thanks to HowStuffWorks for some of the info on explaining the coupon redemption process!)
You can view a visual diagram of the coupon life cycle here and/or check out an example of the coupon redemption policy for ConAgra Foods here.
Here are a few interesting fact on coupon use in 2009:
-With a sour economy, consumers used 27% more coupons in 2009.
-Brands issued 367 billion coupons, at an average face value of $1.44 (That’s a total of $528.5 Billion)!
– Out of those coupons above, a total of $3.5 billion worth of coupons were redeemed.That sounds like a lot, but compared to the $528.5 Billion that were available– that’s less than .7%!
(Facts credit: Coupon Info Now!)
OK, so now that I have thoroughly overwhelmed you with the coupon coding/coupon redemption process, I have a question for ya…would you be interested in seeing a visual depiction (i.e. video) of the life of a coupon starring me Collin, the coupon, starting at the “birth” of the coupon and ending at the “death” of the coupon? My wheels are turning about this topic and I may pursue it if enough readers are interested. What are your thoughts?
Count me in! I would like to see the video of that!
Yes!!! Do it!!!
Definitely!
I would love to see a vidoe! I’ve always wondered what happens behind the scenes with coupons or after they leave my hand. I can’t imagine that the $0.08 comes close to covering the cost of accepting coupons after all the handling that is required to sort them and get them back to the manufacturer! Thanks for the cool info!
Yes, please!
Would love to see a video!
Thanks for all the information you provide us with! I would LOVE to see a video.
Sounds like a great idea! Always wondered what happens to a coupon after I hand it over. What better way to learn, than an educational & entertaining video starring Collin (& maybe a lemon of course) !
YES! Definitely! While I was reading the post I was thinking “This should be a video!!” 🙂
So informative! Thank you!
Collin, I have always wondered about a video of the “life of a coupon” and if there was one out there! I think you should do it!
Collin,
Sounds like a lot of work. If you are up for it….I would greatly appreciate it and most likely benefit from learning more about “the coupon”.
Thank you for this info. I would be interested in a video.
Yes! Would love to see that.
Very educational post!! Would love to see a video.
It sounds like a fun, interesting video to me!! :0)
I would LOVE to see a video! Actually I was going to leave it as a comment before I even saw your question! But I am also curious, how do coupon mfg know the coupon was reedemed, besides just turning it in? (Sorry if you mentioned this, lots of info, but I didn’t see it) For instance, how does P&G know the item was purchased if the sales aren’t a factor? Or are they?
Awesome post Collin!!!
Monica-
Great question. The truth is that the store does not have to submit any information about what you purchased with the coupon. The manufacturer will only care if the store submits more coupons than the amount of products that were in the store’s inventory. For example, if Target submits 1,000 $2/1 Pampers coupons but only had 950 Pampers in their inventory, then Pampers would question 50 of the 1000 coupons sent for redemption. Hope this helps!
I woud love to see it! You are so funny and adorable, I think it would be as informative as well as entertaining!
I’m always interested in being more informed about coupons. It helps me to be more confident when I use them (and it also helps in explaining it all to my wonderful husband!). 😉
yes! i would love to see that, it sounds like so much fun. 🙂
Oh and also, for those who didn’t know about the coupon coding, this is why the Vick’s Vaporub Plug in deal beeped. The codes did not match up to the product although the coupon wording was ANY vicks product. Knowing the language of the coupon can really avoid beepage! Same reason why the Sorry one didn’t work for the Sorry card game (and this one really shouldn’t have worked)
Uh, YEAH!!! I’ve been thinking about this a lot lately. I cherish my little coupons so much, I always wonder about them after I hand them over! LOL!
I would love to see an actual video of this… I tried looking at the diagram.. but got confused… I am the type of person that has to see things in a visual matter instead of trying to imagine it….. so yes, count me in!! I would love to see a video of this!! 🙂
cant wait to see this
I think a video on the lifecycle of a coupon would be interesting. Thanks for posting the coding info. It helps to understand how coupons work, especially when I use so many, so often, and at so many stores! 🙂
YES! I would like to see it! Maybe we can send it for training purposes to all the rude cashiers & managers we sometimes get. So they can get a better opinion about coupons!
Sounds informative and entertaining!
you go girl, I have learned so much and enjoy going to my mailbox now. I would love to learn more.
I would love to see that! Very interesting!
Oh yea! I’ve always wondered how all this works and would LOVE to see what a clearinghouse looks like!
I would LOVE to see a video of this! I have often wondered what happens to the coupons after they leave my hand!
If this is any way involves your going to Del Rio TX to the clearinghouse – DON’T DO IT girl. 3 hours from anywhere. I always shake my head when I see Del Rio on a coupon.
It would make an interesting video. I wonder, though, how do they catch coupon fraud? For instance, if someone is using a coupon for an item that they shouldn’t, what steps to they take to catch that?
Go for it! I would love to learn and see the process.
That would be so neat to visit the center and show how they process the coupons every week in the nationwide! Go for it!
Wow- that’s so fascinating. I just love coupons, and using them to get great deals. I once was known to give my best friend a gift of high quality hot chocolate and a bunch of Bed Bath and Beyond and other coupons for her birthday. She loved it!
Your site is so helpful- I log in several times a day. Thanks for making all of this available to all of us.
okay so here is my ? – what if the coupons beep and they push them thru? lets say it was the wrong item??
does this hurt the store?
I would love to see this! It is very interesting to see all the hard work behind the process 🙂
I was just wondering this past week how the cashiers were able to see a b1g1 free or doubling. I felt I always had to check my receipt to make sure it happened. This info was so helpful! Thanks again so much for the helpful info. I would love to see that video.
The Coupon lifecycle would be awesome! This post was interesting too about the amount of coupons redeemed vs available. And seeing what happens with coupon fraud would be interesting too.
Yes, it would be very interesting, if its not too much work for you.
Collin all of your video ideas are great and this idea is not different– hope that you do it, I would love to see it 🙂
I love watching Vidoe because I am not a very good reader. Lolzz….
Yes!!! I would love to see it. What happens to coupons where the value of the coupon is higher than the price of the product? Does the retailer get the extra overage also or just up to the value of the item?????
Let’s use the $1 on any tide coupon as an example. If you buy the travel size for $0.97 at target and use this coupon, target will get back $1.08 when they redeem this coupon. The stores get back the face value of the coupon in full plus the 8 cents for handling. This is why I find it so silly that so many cashiers and managers give us a hard time when we use coupons. They are actually making more money off of us couponers than someone that doesn’t use coupons.
I would love to see a video on this. I have always wondered what happened to the coupon. thanks for all the work you do
I’d watch it!
Do it girl!
I would love to see a video on this! Awesome idea!
I would love to see that.
Thanks for the nice lesson today.
Looking forward to see the video
Another reason to love your site. It helps us save money and learn a few things in the process. I would love to see the video. Have a wonderful day.
Collin… You are a-ma-zing! Thanks for all this info. I would LOVE to see a video on this!